NHIF paid Sh30m to non-existent clinics, House committee concludes
Dr Robert Monda, the chairman of the parliamentary committee on health, and committee member Fred Outa during a press conference at Parliament Buildings on March 9. The committee on Thursday questioned how a hospital received Sh117 million from NHIF. Photo/Billy Mutai
Parliament’s Health Committee has concluded that the advance payment by Meridian Medical Group amounting to Sh30 million for six service clinics that were not opened before the roll-out of the new medical scheme in January was fraudulently done.
Meridian management agreed that a fraction of the Sh117 million it received from NHIF went to six institutions which were opened just two weeks ago although the funds were made available on March 8.
Committee chairman Robert Monda said the team would assume that Meridian received monies from the National Hospital Insurance Fund (NHIF) without existence of facilities.
Meridian is one of the two private health providers that were contracted by NHIF to offer outpatient services to civil servants and refutes claims that it received Sh30 million for ghosts outlets.
The health services company also contested MP’s claims that it is using the Sh117 million paid to it to expand its facilities.
Meridian told the committee that it presented to NHIF a list of existing clinics and only anticipated new ones as required and received a one-off payment as opposed to that based on individual clinics.
Out of a total of Sh116,935,500 awarded to Meridian as capitation fee to offer services to 32,000 civil servants and their dependants, the new clinics got Sh30 million.
The capitation, which is released to service providers on a quarterly basis, was paid on March 8, after NHIF rolled out its outpatient services in January.
The committee, which interviewed top Meridian managers led by Chief Executive Officer Peter Wambugu, said that money was allocated to Nyali branch (Sh5.05 million), Nyeri (Sh7.4 million), Malindi (Sh5.6 million), Meru (Sh4.9 million) and Nakuru (Sh5.1 million) when they were not open.
The legislators concluded that there was an element of fraud in making payments to non-existent outlets.
MPs also questioned the rationale of payments to a Kisumu clinic whose registration license expired five months ago.
They noted the failure by Dr Wambugu to provide the amount of money the company is waiting for from NHIF for the second quarter, which begun in April, wondering how the hospital will provide services without prior payments as indicated in the contract that spells out capitation.
“Capitation means that you are paid before offering the service. The outpatient scheme is that you get payments and offer service later. I put it to you that you were paid for outlets that were none existent,” said committee chairman Robert Monda.
The provider, which together with Clinix Medicare Limited, won a one year contract to offer NHIF outpatient services to public servants attended to 17,000 patients out of the total 164,000 — principals and dependants included.
“If we put it to you that you were fraudulently paid by NHIF above Sh30 million for ghost outlets which you have been in the process of establishing them two weeks ago, what will you have to say?” asked Dr Monda.
Meridian said the assertions that they capitalised on the payments made by the NHIF to open new branches was erroneous “since NHIF contributions account for a third of our Sh0.5 billion turnover.”
“We gave NHIF a list of 19 facilities that were operational and those we intended to open and we were paid a one-off amount which was not pegged on individual outlets,” said Dr Wambugu who was at pains to explain the circumstances that led to the payments.
Mr Wambugu said he had no knowledge of how NHIF apportioned the 32,000 principal members and where they are located because the national health insurer provided members with a choice to select service providers of their choice.
“Ours was to give the number of facilities and we gave them 19. How they apportioned clients to us is a matter of NHIF. I guess those who chose us knew where our facilities are,” he said.
Registration of doctors
Members of the committee further questioned the legality of some of the doctors working at various Meridian hospitals and challenged the registration of two doctors working at the Capital Hill branch on Mombasa Road in Nairobi.
They directed the company to furnish it with all licenses of its 64 doctors accredited by the Medical Practitioners and Dentists Board.
